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Frankson v. Brown & Williamson Tobacco Corp.

September 29, 2009

GLADYS FRANKSON, ETC., PLAINTIFF,
v.
BROWN & WILLIAMSON TOBACCO CORPORATION, ETC., ET AL., APPELLANTS.



APPEAL by the defendants, in an action, inter alia, to recover damages for personal injuries, etc., as limited by their brief, from so much of a judgment of the Supreme Court (Herbert Kramer, J.), entered June 26, 2007, in Kings County, as, upon, among other things, a jury verdict, is in favor of the plaintiff and against them awarding compensatory damages in the principal sum of $175,000, and punitive damages in the principal sum of $5,000,000.

The opinion of the court was delivered by: Eng, J.

Published by New York State Law Reporting Bureau pursuant to Judiciary Law § 431.

This opinion is uncorrected and subject to revision before publication in the Official Reports.

ROBERT A. SPOLZINO, J.P., FRED T. SANTUCCI, DANIEL D. ANGIOLILLO and RANDALL T. ENG, JJ.

OPINION & ORDER

(Index No. 24915/00)

DECISION & ORDER

The late Harry Frankson began smoking cigarettes in 1954, when he was 13 years old. Frankson soon became a heavy smoker, smoking at least a pack of cigarettes a day over the next 40 years. The brand Frankson regularly smoked throughout his life was Lucky Strikes, originally manufactured by the American Tobacco Company (hereinafter American), and after 1995 by its successor, the Brown & Williamson Tobacco Corporation (hereinafter Brown & Williamson). Frankson was diagnosed with lung cancer in September 1998 and died five months later, at the age of 57. It is undisputed that Frankson's lung cancer was caused by smoking American's Lucky Strike cigarettes.

Following Frankson's death, his widow, Gladys Frankson, commenced this action against Brown & Williamson, individually and as successor by merger to American. Also named as defendants were the Tobacco Institute, Inc. (hereinafter the Tobacco Institute), a nonprofit trade organization formed in 1954, and the Council for Tobacco Research-USA, Inc. (hereinafter the Tobacco Council), a tobacco-company sponsored organization formed that same year to fund research on smoking and health. The plaintiff sought damages on theories, inter alia, that the defendants had fraudulently concealed the health risks of smoking prior to 1969, and had conspired to fraudulently conceal these risks. The plaintiff also asserted several defective design claims against the defendants.

After a four-week trial conducted in late 2003, the jury returned a verdict finding American liable for having fraudulently concealed the health risks of smoking prior to 1969, and all of the defendants liable for conspiracy to fraudulently conceal these risks. The jury attributed 10% of the fault on the fraudulent concealment and conspiracy claims to American, 5% to Brown & Williamson, 10% to the Tobacco Institute, and 10% to the Tobacco Council. In addition, the jury found American 15% at fault on the design defect claims. The jury apportioned the remaining 50% of fault to Frankson, and awarded compensatory damages in the sum of $350,000. The jury also expressly found that the defendants' conduct was so wanton, reckless, or malicious as to warrant the imposition of punitive damages. A trial on the issue of punitive damages then ensued, culminating in a jury verdict awarding the plaintiff the sum of $20 million. The jury apportioned $2 million of the punitive damages award against American, $6 million against Brown & Williamson, $6 million against the Tobacco Institute, and $6 million against the Tobacco Council.

The defendants moved pursuant to CPLR 4404(a) for a new trial or, in the alternative, to either strike the punitive damages award or reduce the amount of that award to comport with due process. In support of their motion, the defendants argued, among other things, that the jury verdict in favor of the plaintiff should be set aside because the trial court had applied an erroneous standard for the admission of scientific evidence, which had prevented them from showing that they relied upon the views of leading authorities in the 1950s in concluding that there was no established link between smoking and lung cancer. The defendants further contended that the plaintiff had failed to present legally sufficient evidence to support her design defect claims. In addition, the defendants claimed that punitive damages should not have been assessed against the Tobacco Institute and the Tobacco Council because these entities were no longer in existence, and that the amount of the award exceeded the constitutionally permissible ratio between compensatory and punitive damages. In three separate orders dated June 22, 2004, the trial court granted the defendants' motion only to the extent of directing a new trial on the issue of punitive damages unless the plaintiff stipulated to reduce the punitive damages award to $5 million, which was to be apportioned $4 million against Brown & Williamson, $500,000 against the Tobacco Institute, and $500,000 against the Tobacco Council. The plaintiff agreed to so stipulate.

Thereafter, the defendants appealed from stated portions of the three orders, raising numerous arguments, which included a claim that the plaintiffs had failed to present legally sufficient evidence to prove that the defective design of the cigarettes smoked by Frankson was a proximate cause of his injuries. The defendants also challenged the trial court's standard for the admission of scientific evidence, and continued to maintain that punitive damages should not have been assessed against the Tobacco Institute and Tobacco Council because the assessment of damages against defunct entities served no deterrent value. With respect to the issue of punitive damages, the defendants briefly contended that during the punitive damages trial the court had improperly permitted the plaintiff's attorney to make arguments that had no nexus to the decedent's injuries, including a statement that the defendants' actions had caused the death of thousands of other citizens of the State of New York. The defendants further maintained that the trial court had improperly instructed the jury that it could consider evidence of conduct by the defendants which did not directly cause or contribute to Frankson's injuries if such evidence would help "shed light on the defendant's motivation for acting the way they did, towards any New York State smokers, and particularly Mr. Frankson." In a decision and order dated July 6, 2006, this Court modified one of the three orders appealed from by granting that branch of the defendants' motion which was to set aside the jury verdict in favor of the plaintiff on her defective design claims, noting that she had explicitly elected not to oppose the defendants' argument that these claims were not supported by legally sufficient evidence (see Frankson v Philip Morris, Inc., 31 AD3d 372, 374). However, this Court rejected all of the defendants' remaining contentions.

Following this Court's modification, and additional motion practice, on June 26, 2007, judgment was entered in favor of the plaintiff and against the defendants, awarding the plaintiff compensatory damages in the principal sum of $175,000 ($350,000 reduced by the jury's 50% apportionment of culpability against Frankson), and punitive damages in the principal sum of $5 million.

On appeal from the judgment, the defendants rely upon the United States Supreme Court's February 20, 2007, decision in Philip Morris USA v Williams (549 US 346) to support their argument that the punitive damages award should be set aside because the jury was not properly instructed that it could not award such damages to punish the defendants for harm to other smokers. In addition, the defendants continue to challenge the trial court's standard for the admission of scientific evidence, and to contend that punitive damages should not have been assessed against the Tobacco Institute and the Tobacco ...


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